4 Signs That 2021 Will Be a Good Year for Real Estate Investments
2020 is far from over, but it’s already safe to say at this point that it has been a bad year, economically speaking. The COVID-19 and, more precisely, the financial downfall that came with it skipped only a few sectors — and the real estate investment sector, unfortunately, was not one of them. When you’re thinking of how to make ends meet by the 30th of the month, you are less inclined to close deals worth thousands of dollars, and when physical mobility is restricted, it is very hard to seriously consider properties for investments. What can we say? A bad year overall.
However, people are talking about 2021 in terms of recovery and getting back on the horse. This voice is coming from veteran real estate investors and financial analysts as one. I’m Ofir Eyal Bar, a successful real estate investor and digital marketing entrepreneur, and I want to take you on a dive into the prospects of the future of the real estate. By the time you finish reading this, I hope you’ll realize, just like I did, that there’s careful room for hope.
1. Will 2021 be the year we win our battle against the Coronavirus?
Talk about a vaccine being approved for treatment by the beginning of 2021 is certainly encouraging, financially speaking, and even if that only happens by mid-2021, that’s also good news. The point here is that markets (and the real estate market being no exception here) respond to forecasts just as much as they do to actual developments. Just the professional talk of light at the end of the COVID-19 tunnel is enough to get the monetary wheels going — enough for people to start considering investments again. My experience tells me that real estate, being more stable and steadier than stocks or commodities, is predicted to be one of the first fields to feel that.
2. A small world after all?
If there’s one thing we learned from the pandemic, it is that different nations were affected by it in different magnitudes. Since real estate investment opportunities are spread all around the globe, it is safe to say that investors will soon start looking for places where the economy has persevered and where governments knew how to control the disease with minimal impact on day-to-day life — and put their money there. By 2021, many believe that these investing ‘hotspots’ will be found.
3. A frozen market?
The economic slowdown has had its effect on real estate investment, that’s for sure. But what we’re witnessing is the short-term aftermath. In the long term, people will still need housing and commercial space — whether there’s a pandemic or not. That means that whatever work that had been brought to a halt is bound to be completed. Projects are going to be resumed and investors, in return, are going to show more interest once that happens. Add to that the fact that other sectors may not recover as quickly, and you’ll see a diversion of capital to real estate.
4. The day after the elections, things will be better
This may seem contradictory to basic logic but stick with me. The political instability in the United States these days will come to an end once a president is chosen (regardless of his identity). That is estimated to bring trust back to American markets — including real estate. We all saw how the real estate crisis in 2008 in the USA brought other countries down with it. Now, think of the opposite effect: A boom in real estate investment that starts in the States could generate one across the world.
Wait, there’s a ‘but’…
Having said all of that, I must emphasize that these are only signs. A vaccine might not be ready in time, the real estate market might not defrost, and political stability might not be obtained in the USA. Don’t take these words as a guarantee that 2021 will be a great year for the real estate market. Do, however, keep in mind that the forecast presented here by me (and others) is optimistic. In today’s financial reality, I, Ofir Bar, believe that’s also something.